Tanzania Cotton Marketing Board v Cogecot Cotton Co SA 1997 TLR 63 (CA)

TANZANIA COTTON MARKETING BOARD v COGECOT COTTON CO SA 1997 TLR 63 (CA) A

Court Court of Appeal of Tanzania - Dar es Salaam

Judge Lubuva J B

CIVIL APPLICATION 52 OF 1996

24 February 1997

Flynote

Civil Practice and Procedure - Appeals - Stay - Of execution pending appeal against decision of High Court - Applicant required to give details and particulars of loss it would C suffer if stay not granted.

-Headnote

The applicant applied for a stay of execution of a decision of the High Court which had granted an application for the formal filing of an arbitration award against the applicant. The applicant contended that if the stay order were not granted the outcome of the intended appeal would be rendered nugatory if it went in the applicant's favour. It was contended further that if the stay were not granted its business would suffer such great and irreparable loss that it would be brought to a standstill.

Held:

(i) That the applicant had not gone beyond mere assertion that it would suffer great loss and that its business would be brought to a standstill. Unless details and particulars of the loss were specified there was no basis upon which the Court could satisfy itself that such loss would be incurred; F

(ii) The applicant had furthermore failed to indicate, beyond the vague and generalized assertion of substantial loss, that the loss would be irreparable. Any loss which the applicant was likely to suffer could be adequately compensated for by an award of damages;

(iii) The granting of a stay was a matter of discretion which was be exercised on a common sense and balance of advantage basis. In the present case there were no good or sufficient reasons for the grant of a stay even on the basis of common sense and balance of convenience approach.

Case Information

Application dismissed.

Cases referred to: 

1. Salim Salim Bakhressa v Ally Ngume Civil Application No 56 of 1995 (unreported)

2. Bansidhar v Pribhu Dayal [1954] AIR 41 Raj

3. Yaledi Swai and Anor v Lilian Mavo and Anor Civil Applicaton No 18 of 1994 (unreported) I

4. Joseph K Mlay v Ahmed Mohamed Civil Application No 39 of 1995 (unreported)

5. Simonite v Sheffield County Council Times Law Reports, 12 January 1993

6. Winchester Cigarette Machinery Ltd v Payne and Anor (2) Times Law

Reports, 15 December 1993 

Mselem for the applicant.

Mkono, Dr Kapinga and Ms Kasonda for the respondent.

[zJDz]Judgment

Lubuva JA: 

This is an application for a stay of execution. It arises from the decision of 16 August 1996 by the High Court (Kaji J) in Miscellaneous Civil Cause No 34 of 1996. In a notice of motion filed under Rule 9(2)(b) of the Court's Rules, 1979 the D applicant is applying for an order that the execution of this decision be stayed pending the determination of an intended appeal the notice of which was lodged on 22 August 1996. The application is supported by an affidavit deponed by one Ahmad Salum Kilingo, the Legal Secretary to the Tanzania Cotton Marketing Board, the applicant. The undisputed historical background to the case is short and may briefly be stated as follows: During the period 1993 and 1994 the E applicant had entered into a sale agreement for the purchase of raw cotton exported by the applicant. The respondent company was the buyer. A dispute between the applicant (seller) and the respondent arose which was referred to the Liverpool Cotton Association Ltd for arbitration. An award in favour of the F respondent was confirmed by the Technical Appeal Committee of the Arbitrators -- Liverpool Cotton Association Ltd. On request by the respondent, the Arbitrators filed the award before the High Court. Hence the institution of Miscellaneous Civil Cause No 34 of 1996.  

The applicant raised objection against the filing of the award G before the High Court on the ground that improper procedure in filing the award was invoked. Upon careful and detailed analysis of the submission by Mr Mkoro, learned H Counsel for the respondent in this application who was then the applicant and Mr Mselem, learned Counsel for the applicant in this matter who was then the respondent, the learned judge overruled the objection against the applicant and granted the application for the formal filing of the award by the arbitrators. The applicant is dissatisfied with that decision and so the notice of appeal has been filed. It is the applicant's prayer that the execution of the decision/decree be stayed pending the hearing of the intended A appeal. In the affidavit in support of this application, Ahmed Salum Kilingo on behalf of the applicant inter alia, advances the following reasons for seeking a stay order: B 1. That the ruling of the High Court raises very important points of law which call for the determination of the Court of Appeal 2. That if the award/decree is executed the applicant will suffer great injuries as the decretal amount will be very high thereby bringing the business of the applicant of buying and exporting cotton to a standstill. C At the hearing of this application, Mr Mselem, learned Counsel submitted that if the stay order is not granted, the outcome of the intended appeal would be rendered nugatory in the event the appeal now pending succeeds in favour of the applicant. 

He further argued that as the decretal amount is so great, the applicant's business would suffer such great and irreparable loss that it would be brought to a stand still. So, he prayed for the granting of the stay order. For the respondent, Mr Mkono, learned Counsel assisted by Dr Kapinga and E Pauline Kasonda, learned Counsel appeared before me in this application. In the first place, it was submitted by Dr Kapinga that the ruling of the High Court dated 16 August 1996 was a declaratory order which was not capable of execution. For that reason, Dr Kapinga argued, there was no basis upon which a stay order could be issued. In support of this argument, he referred to a decision of mine Salim F Said Bakhresa v Ally a Ngume (1). In that case, a stay order was sought in respect of a High Court order dismissing an application to set aside an ex-parte judgment. There, it was held that the High Court order of dismissal was merely G declaratory, incapable of execution in respect of which no stay order could be issued. The reason was that, with the dismissal order by the High Court, the status quo reverted to was the decision of the District Court which was capable of execution in respect of which a stay order could be issued. In the instant case, the H situation is different because, with the filing of the award in court in terms of s 16(1) the Arbitration Ordinance, Chapter 15 of the Laws, such an award is capable of being enforced as if it were a decree of the court.  

With respect, Dr Kapinga's submission that the ruling of the High Court was declaratory is rejected.  Countering the argument that the applicant would suffer irreparable loss if a stay order is not granted, Dr Kapinga forcefully submitted that this prayer was without merit. It was Dr Kapinga's view that a mere assertion on the part of the applicant that if the amount awarded is to be executed, the applicant will suffer such great loss that the business of the applicant would be brought to a stand still B is vague. He further stated that the affidavit deposed to by Mr Kilingo is too general, it does not give any particulars of the loss that the applicant would suffer if no stay order is issued. I have been referred to a number of decided cases in India, England and the decisions of this court on this point. For instance, he referred to the Indian case of Bansidhar v Pribhu Dayal (2) where it was stated: `It is not enough merely to repeat the words of the Code and state that substantial loss will result; the kind of loss must be specified, details must be given, and the conscience of the court must be satisfied that such loss will really ensue.' D On the basis of this principle, Dr Kapinga submitted that this ground was without foundation because there was nothing to convince the Court that such loss would really ensure on the part of the applicant if the award is executed. E At the outset it must be stated quite clearly that this being an application for stay of execution filed under Rule 9(2)(b) of the Court's rules, it is discretionary. It's grant or otherwise would depend on the individual circumstances of the case at hand. In F this case, the decision turns around the issue whether the applicant would suffer not only substantial but irreparable loss which cannot be atoned by way of damages. This aspect was, as shown above, sufficiently canvassed by the G learned counsel for both parties. 

On this, I am respectfully in agreement with Dr Kapinga, learned counsel that the applicant has not gone beyond mere assertion that he would suffer great loss and that his business would be brought to a stand still if the award is executed. In my considered view, this is quite clearly unsatisfactory. As it was held in the case of Bansidhar (supra) unless details and H particulars of loss are specified there is no basis upon which the Court can satisfy itself that such a loss would really be incurred by the applicant. What is more, in the instant case, the situation seems to me even worse. From the affidavit sworn by Kilingo, in essence, it is stated that if the award is executed, the business of the applicant would be brought to a stand still. As a result, the applicant's financial position would be incapa- citated, so it was asserted by Mr Mselem, learned Counsel. If that is the A apprehension as expressed by Mr Mselem, learned Counsel for the applicant then that leaves open the possibility that the applicant's financial position is such that the decretal amount awarded could be paid for. But what seems to worry the applicant is the resulting hardship in future business dealings. Such would in my view, be the normal hazards of any judgment-debtor. This was further B underscored in the case of Bansidhar cited supra.  

There, it was further observed: `The words ``substantial'' cannot mean the ordinary loss to which every judgment-debtor is C necessarily subjected when he loses his case and is deprived of his property in consequence. That is an element which must occur in every case and since the Code expressly prohibits stay of execution as an ordinary rule it is clear the words ``substantial loss'' must mean something in addition to and different from that.' D In this case from the deposition in the affidavit and the submission by the applicant's counsel at the hearing of this application, I am not convinced that the applicant has shown that in fact he would be subjected to substantial loss if stay order is not granted. The matter has not, with respect, been taken beyond the E stage of vague assertion that great loss would be incurred and that business would be brought to a stand still if stay order is not issued. That is not enough. Then there is the question of whether the loss is irreparable. I have already held F that in this case, the applicant has not advanced the case beyond the vague and generalised assertion of substantial loss in the event a stay order is not granted. That is, granted that there was such a loss to be incurred by the applicant, would such a loss be adequately compensated by an award of damages? In a number of cases, this Court has held that stay order is not normally granted unless the Court is satisfied that the applicant has suffered an irreparable loss that cannot be atoned by way of damages. 

See for instance: Yaledi Swai & Another v Lilian Maro and Another (3);Said Salim Bakressa v Ally A Ngume (1); Joseph K Mlay v Ahmed Mohamed (4). H From the principle stated in these cases, it seems clear to me that having regard to the circumstances of this case the applicant can hardly be said to have or is likely to suffer substantial and irreparable loss if execution of the award is not stayed. Such loss or da- I 1997 TLR p68 LUBUVA JA A mage is, in my opinion capable of being adequately compensated by way of damages. Another factor for consideration in this matter is the question whether the applicant has shown a prima facie case with a probability of a success in the appeal pending. It is however to be noted that at this stage it is rather premature to make any meaningful assessment of the chances of success of the appeal pending B because arguments from both sides have not been heard. At any rate it is to be observed as well that even elsewhere in countries with similar jurisdiction, the current trend seems to indicate a move away from this factor in matters of granting a stay. This can be seen from England in the case of Simonite v Sheffield C County Council (5) where it was stated: `... and that there were strong grounds for an appeal was no reason for granting a stay, for no one ought to appeal without strong grounds for doing so'. (emphasis supplied) D And so, with this restatement of the applicable principle my view is further reinforced that I am not persuaded either by this factor that this application warrants the issuance of a stay. E Finally, I will look into the matter in the light of the third element which is also taken into account in considering applications for a stay.  

That is, when the court is in doubt having taken the various factors into account, the matter is decided on the balance of convenience. As stated before, the granting of a stay is a matter of F discretion and this is clearly indicated under the provisions of Rule 9(2)(b) of the Courts Rules, 1979. It is common knowledge that principles involving the exercise of a discretion crystallize and take root from established practice. For instance, in England, in situations of this kind, the current trend and practice of the court has G moved on to involve common sense and a balance of advantage. In the case of Wincester Cigarette Machinery Ltd v Payne and Another (6) the court inter alia stated: H `In recent cases it has been said that the practice of the court had moved on from the principle that the only ground for a stay was the reasonable probability that damages and costs paid would not be repaid if the appeal succeeded. These cases held that the approach of the court now was a matter of common sense and a balance of advantage ... But in holding any such balance of advantage, full and proper weight had to be given by the court to the starting principle that there had to be a good reason for depriving a plaintiff from obtaining the fruits of a judgment.' (emphasis supplied). A I have closely examined this principle in the light of the circumstances of this case. With respect, I am unable to go along with Mr Mselem, learned Counsel that there are good or sufficient reasons for the grant of a stay even on the basis of common sense and balance of convenience approach. B Consequently, the application is dismissed. For this application it is ordered that each party to pay his own costs.

1997 TLR p69